Year End Q&A Special, With Shannon O’Neil

LINDSAY:
Welcome to The President's Inbox, a CFR podcast about the foreign policy challenges facing the United States. I'm Jim Lindsay, director of Studies at the Council on Foreign Relations. This week is The President's Inbox year-end question answer special. 

 

We will be departing from the show's normal interview format to answer questions that TPI listeners have submitted to us over the past few weeks. With me to tackle your questions is Shannon O'Neil. Shannon is the vice president, deputy director of Studies and Nelson and David Rockefeller senior fellow for Latin America Studies here at the Council. She has written extensively on global trade, supply chains, Mexico, Latin America, and democracy. Her most recent book, which I highly recommend buying and reading, is The Globalization Myth: Why Regions Matter. Shannon, thank you for joining me.

 

O'NEIL:
Thanks for having me, Jim. It's a real pleasure.

 

LINDSAY:
Now I want to begin our conversation by thanking everyone who submitted questions. Our audience has obviously been doing their homework. We received a lot of great questions. We're going to answer as many as we can in the time we have allotted so my apologies if we don't get to the question that you asked.

 

Shannon, we're going to begin with you and I have a question here from Ralph via email, and Ralph asks, "How serious is the Panama Canal transit problem? How will it affect trade and supply chains next year?"

 

O'NEIL:
Well, great, thanks Jim, and thanks, Ralph. That's a great question. So for those who aren't following it, the Panama Canal is one of the most important waterways that connects the Pacific Ocean and the Atlantic Ocean, about 5 percent of global trade goes through there, and they are having problems because of drought. So the water levels have fallen, which means fewer boats and fewer of the bigger boats and container ships can get through that passageway. That wouldn't seem like a big problem, just 5 percent of global trade, except it's a really big part of the trade that comes to the United States. So it hits the United States, especially the eastern seaboard more than other places.

 

It also comes at a time when there are problems in the Suez Canal and they're part of the Middle East and the challenges and volatility there. We see Houthi militants have stopped a lot of the trade that's going in out of there. So right now we're seeing two of the biggest canals in the world being either slowed or even shut down to global trade affecting the United States, Europe, and elsewhere. So I think this will continue to be a problem into 2024.

 

LINDSAY:
It's a powerful reminder, Shannon, that a lot of our global trade and all of our countries depend upon global trade, go through choke points and if those choke points get choked off, there are very big ripple effects. Do we know why Panama has been suffering from drought?

 

O'NEIL:
I mean, this is really the effects of climate change. We're seeing changing weather patterns. We're seeing strengthening of two factors, what they call El Niño and La Niña, which are sort of global water and precipitation forces that happen in the Western Hemisphere over various years. And so it's been drought there. It's been heavy rains in other places, but we're seeing those accelerated and really augmented in large part because of the changing climate temperature. So that one looks to continue potentially into the foreseeable future.

 

LINDSAY:
Climate change is here. It's not something for the future.

 

O'NEIL:
Exactly. And it's not just...I live here in New York a little bit warmer here in December than it used to be when I was growing up, but it's also affecting things like global trade.

 

So Jim, let's move on. Now it's your turn. I'm going to take a question from Wes.

 

WES:
There's been much talk in the last two years about whether Russia should keep its permanent seat on the UN Security Council. Other nations have been advocating for more global representation. For example, President Lazarus Chakwera of Malawi has used his UN General Assembly talk the last several years to advocate for the African continent to have a permanent seat on the council. So my question is, do you think there's any appetite for change in the Security Council? And secondly, is there any framework for how a change could even be made?

 

LINDSAY:
Well, great question, Wes, or should I say two great questions and fortunately they're both easy to answer. First, yes, there is a procedure for amending the UN Charter to change the structure of the UN Security Council, and no, there's no appetite to do so.

 

Let me note that on in terms of the formal process for amending the UN charter, it requires two-thirds of the member state to ratify the change and all of the permanent members of the UN Security Council. That's a sticking point because obviously those countries have a veto. So any of the five permanent members, the United States, China, Russia, the United Kingdom or France, can halt security reform in its track simply by saying, "Nope, not interested." And the fact is the P5 as they're called, aren't interested in security council reform because it would diminish their influence.

 

So there's talk for example, that Japan as the world's third-largest economy should be a permanent member. Try selling that to the leadership in Beijing. Likewise, some people say we need representation from countries from the Global South, so perhaps Iran should join the UN Security Council. It's hard to imagine any American president signing off on that change. So no, I don't think we're going to see any significant restructuring of the UN Security Council, but that doesn't mean Wes, that we won't see think tanks churning out articles, arguing the merits of reform of the UN Security Council, but you won't see them coming out of the Council on Foreign Relations because the politics of doing so are so lousy.

 

O'NEIL:
And you'll continue to see presidents from countries that are not on the Security Council probably asked to join.

 

LINDSAY:
Oh, certainly. I mean, speaking of Latin America, I'm sure Lula would love to see Brazil named a permanent member of the UN Security Council.

 

O'NEIL:
Indeed, he would.

 

LINDSAY:
Okay, let's go back to you Shannon. I'm going to ask a question of you that comes from Jane via Instagram. She asked, "What are the long-term implications of China expanding its soft power in Latin America and Africa and the U.S. falling behind?"

 

O'NEIL:
This is a great question, Jane, and when you look back at these last twenty years, one of the biggest changes around the globe has been the rise in importance of China in Latin America and Africa and other places in the Global South. And so you look back at 2000, they were a small player in these places, but they have become one of the dominant trading partners for many countries in Latin America, many countries in Africa. They have become one of the biggest investors, particularly in raw materials, in oil and gas, and all kinds of minerals and the like, especially. Also, agricultural products. They have become one of the biggest bankers for many of these countries. They are the ones who provide loans, sometimes the only loans to countries in these various places. They've also been some of the biggest builders of infrastructure, so all kinds of roads and rails and dams and electricity grids and all kinds of things. Really, the Chinese have stepped in where other countries have not been able to.

 

And so this has been a boon to many of these countries. It's provided them with all kinds of benefits and growth and opportunities for trade and the like. But it's also come at times with, as you mentioned in your question, Jane, soft power and sometimes a little bit of hard power too where they work to encourage, convince, perhaps coerce countries to go along with them in those kind of areas, whether it's in the UN General Assembly, whether it's in other kinds of decisions being made around the world or if it's in choices for bids for various infrastructure and the like. And so there really is a double-edged sword for lots of these places. And Latin America and Africa and particular are two regions in the last twenty years that have seen what economists call premature de-industrialization. So they lose their manufacturing sector before they get wealthy. And a big part of that is some of their relations with China where they're sending out raw materials and they're bringing back finished goods that undercut their local manufacturing.

 

So whether or not the United States is falling behind in some places it is because China has really taken that preeminent role in terms of an investor, in terms of a trading partner, but in other ways, some of these countries too are seeing it's not an unalloyed good all the time, that there's two sides to this, and some of it is not as attractive as they once thought. So I think there's still space for the United States in lots of these countries as they look forward and these countries try to grow and help their populations and become stronger wealthier places. But China has made big inroads to be sure.

 

LINDSAY:
Shannon, I have to ask, when the Biden administration came into office, there was a lot of talk about how the United States was now going to pay more attention to Latin America, be more active, send more aid. Did any of that happen?

 

O'NEIL:
There are some areas. They had big ideas. They had a thing called World Build Back Better. They had lots of plans to reach out, but they have concentrated most of their attention on Europe and rebuilding that alliance, and on Asia on trying to build an alliance with the Southeast Asian countries and India and others that are there. So they've spent less time frankly in Latin America.

 

Though I will say as we look at the Biden administration's agenda and especially its national security agenda to secure critical supply chains in semiconductors, in all kinds of critical minerals, in electric vehicle batteries, and like, many of the answers run through Latin America as these are our trading partners, these are countries that are included in what's called the Inflation Reduction Act, which is a big many hundred billion dollar bill and law to help build up an electric vehicle and a renewable energy space here in the Western hemisphere. There are areas where Latin America's included but much less than those other places.

 

LINDSAY:
And we should note you've written a number of pieces over the years about the benefits the United States could generate if it were to invest more and think more strategically about its economic relationship with Mexico in particular.

 

O'NEIL:
As we look forward in the most commercially viable solutions to U.S. national security concerns that we want supply chains that are secure and safe and don't involve what could be hostile actors or hostile countries down the road, Mexico is a solution. It's also a way to make profitable products.

 

And so the United States, as we look to export to the eight billion other people that live all over the world, and we try to compete with exports from other places, other places have regional supply chains that make products that are good and they make them fast and they make them cheap. And for the United States to do that, you need partners too. And Mexico and Canada for that matter are the two easiest and right there for us to work with and we have lots of ties to them. We have trade agreements and we have other kinds of ties. So there's lots to be done if we look more closely at the Western Hemisphere for sure in our geopolitics.

 

So Jim, let's go back to another geopolitical question, actually a foreign policy question. Let me take this one. This is from Rob and this is a great question for you.

 

ROB:
Hey Jim, thanks for taking our questions. I'm curious which has a larger role in steering our foreign policy, Congress with its constitutional authority or private enterprise and its invisible hand? Thank you.

 

LINDSAY:
Terrific question, Rob. And I would suggest that you enroll in a PhD program at your local university and you can write a dissertation on it because obviously that's a big complex question. I guess my quick response would be Congress matters more because Congress actually gets to write the rules of the road and the regulations and on many issues, the private sector companies either have no interest in what the United States is doing or they themselves are split.

 

Now, this is not to say that the private sector companies can't have an outsized impact on policy. Shannon knows very well when it comes to trade and the details of trade agreements, companies become very interested in the particulars, and I shouldn't just say companies, I should say all private interests. So for example, when you get to trade pharmaceutical manufacturers, minors and the rest all have something at stake because how you set the terms of trade obviously affect their bottom line in the case of unions and the rest, their employment status.

 

But I would end by saying, as important as Congress may be, the president is many more times powerful on foreign policy. Here's the reality of American politics as the system has evolved, not necessarily as the framers intended it. When it comes to foreign policy, the president generally can act unless Congress can find a way to stop him and someday her. And it's very hard for Congress to do that because in many cases, stopping a president requires Congress to actually come together and pass a law. And remember, all laws can be vetoed by the occupant of the White House, which means you got to get to two-thirds plus one support. As I look around Rob, I don't see a lot of issues on which you can get two-thirds plus one of the House and the Senate to agree.

 

O'NEIL:
That is true. Let me ask you, Jim, do you see a change in that power dynamic, whether it's president versus Congress, Congress versus the private sector just over the last few years under the Biden administration? Do you see a very forward leaning Biden administration? I mean, I see them doing lots in the industrial policy space that actually affects the private sector, lots of export controls and investment screening and all kinds of stuff. I also see Congress pretty active passing things like the Uyghur Force Labor Prevention Act and other sorts of things. So how do you see that balance under this last administration?

 

LINDSAY:
Well, the basic answer is that the relative influence of all of these actors depends upon the issue and how events change. As we have witnessed over the last four or five years, a growing consensus that China is problem number one and U.S. foreign policy has to confront it, what we're seeing is presidents and Congress stepping up and making decisions oftentimes over the objections of private sector actors who see their bottom lines being hurt. And this is why we sort of give precedents, going back to Rob's original question, to the elected branches in terms of who has the most power at the end of the day. 

 

And again, specifically on China, we could see even more far-reaching steps in the future because one of the things we have to keep in mind is not only can Congress today pass laws, there are all kinds of laws already on the books and any president comes in, Democratic president, Republican president, they have lawyers, and those lawyers can go through those laws and they can find power to act that the people who wrote those laws maybe five years ago, ten years ago, fifty years ago, never imagined. And all of a sudden you can have a White House taking steps that can have quite far-reaching consequences.

 

We saw that particularly in the Donald Trump administration where President Trump and his lawyers read trade law in a way differently, I think than most people conceived it in order to place tariffs on variety of countries, including America's closest friends, partners and allies for national security reasons. So all of a sudden steel coming in from Canada or from France or Germany was seen as a national security threat and had to have a tariff placed on it.

 

So always remember that once Congress passes a law, it sits on the books for a long time until Congress gets around to repealing it, which it often doesn't and that creates opportunities for presidents to act in ways that are in addition to whatever constitutional powers they say they can bring to an issue.

 

Shannon, I have a question here from Jamil.

 

JAMIL:
Hi, my name is Jamil. My question is regarding the tension between Guyana and Venezuela. How serious is that situation and do you think it's going to actually maybe lead to conflict between the two countries, and how serious is the United States and backing guy in that conflict? Is there real potential for a type of armed conflict happening in the Western Hemisphere? Thank you very much.

 

O'NEIL:
Well, this last year has definitely been a year of global challenges and volatility, but I don't think a lot of people had Venezuela, Guyana on their bingo card in terms of the next hot conflict.

 

LINDSAY:
Shannon, I think there were a lot of people rushing to their Google Maps to figure out where Guyana is. No offense to the people of Guyana, but it has not been high on the list of movers and shakers in global politics.

 

O'NEIL:
No, it has not. And so this is a conflict that's been going for decades and there is a part of Guyana that is disputed territory. There's a long history, it's in international courts right now that it looks like Guyana will likely win in the end because there's been various treaties and decisions along the way that now Venezuela is less happy with.

 

But the real reason that you saw this and really led to this moment and real potential conflict is because of the very difficult Venezuelan domestic politics right now. Maduro, Nicolás Maduro is the president of Venezuela, who is an authoritarian leader, is being pressured by the United States, by others, by its own domestic opposition to hold elections in 2024. The country needs to hold elections in 2024 to maintain any semblance of a democratic electoral process, and the opposition looks pretty strong and together, and if they let the main candidates run, they might actually win. So this was a way of sort of rallying around the flag, putting a referendum that "we should take back this territory from Guyana." So really, really about domestic politics there.

 

Now, Maduro did not get a particularly good reception in international sphere, not obviously from the United States and other places, but even from Brazil, from other countries in Latin America that have relationships with Maduro and with Venezuela. And so I think this is much more bluster. In fact, the two presidents have met and they've decided to take the temperature down and have discussions basically.

 

So I don't see a conflict happening. If there was a conflict to happen, it would be because there are some troops rallied on the borders and there'd be an accident rather than a purposeful invasion. So I think we have gotten past this potential conflict or explosion along the border, but it does tell you the importance of domestic politics and lots of these foreign policy decisions. One might argue other places that have been more consequential and that where we have seen conflict, whether it's China and India or even Russia and Ukraine, a lot of it's about domestic politics and perceptions and the like.

 

And so that is a challenge because Venezuela is still a country that is authoritarian, it's repressive, and they're going to see a lot of volatility in this year to come because the opposition is going to try to force an election to be held. And the U.S. is part of that because the U.S. has relieved some sanctions against Venezuela in exchange for freer and fairer elections for the year to come.

 

LINDSAY:
Do you think we're going to get freer and fairer elections in Venezuela in 2024, Shannon?

 

O'NEIL:
I think at this point it is quite unlikely that we will get that. So I think we will see some likely some snapback of U.S. sanctions on Venezuela in various formats. But the challenge there is sanctions maybe hurt the regime, but they really hurt the people who are living in Venezuela. And we've seen so many people leave Venezuela because the economy and life there is so difficult. Millions of people have left Venezuela and are living, some come to the United States, but many, many more live all over Latin America right now.

 

LINDSAY:
Particularly in Columbia and Brazil is my understanding.

 

O'NEIL:
Yes, there's upwards of two million Venezuelans who live in Columbia, hundreds of thousands in Brazil and Ecuador and Peru and Argentina and Chile and up places all over. And then many are also making the trek up to the United States. We see that as well. So it is a big challenge, but hopefully the tensions that we saw between Venezuelan and Guyana have dissipated.

 

So Jim, I'm going to throw a question back to you, and this is a short but not easy question to answer, I would say. This is from Luis via Instagram, and his question is, "Would Russia be willing to negotiate an end to the war in Ukraine?"

 

LINDSAY:
Great question. Answer's no.

 

O'NEIL:
And why not?

 

LINDSAY:
Or I could rephrase it and say, yes, they're willing to negotiate if the negotiations are entirely on their terms. Russian president Vladimir Putin has made it very clear, including in a press conference earlier this month, that he intends to be in the war against Ukraine until he wins and that he's not going to back down. By all accounts, Putin views the war as going in Russia's favor, that time is on Russia's side and that whether it is 2024 or 2025 or 2026, eventually Ukraine will be defeated. And again, the big issue here and the big determinant is to whether Putin is going to be able to achieve his objectives is whether or not the West continues its support for Ukraine.

 

As you know, there's a log jam on Capitol Hill right now about trying to find a way to come to agreement to provide additional military aid to Ukraine. That log jam is not primarily about the merits of supporting Ukraine or disagreement about what would happen if Ukraine were to lose. It is about the issue of the American southern border and how to put together a package that would enable Republicans, particularly House Republicans to vote for Ukraine aid, and we'll see what will happen on that score.

 

Obviously if we continue to have paralysis in the U.S. Congress, we will end up in a situation in which the Ukrainians will be at a great disadvantage. The much vaunted summer counter offensive in Ukraine did not produce the kind of results that people had hoped for. So now we're looking at basically a grinding war of attrition, but again, the devastation on the battlefield is significant. The level of war materiel being expended is at a very rapid rate, and without the support of the West, not just the United States, but the West in general, Ukraine will be in a very difficult position in terms of preserving the gains that is made in the first two years of the war.

 

O'NEIL:
Jim, as you look at that conflict, what is the most probable scenario or sort of end game you see and are there things the United States or Europe or others could do to move it to what we would see as a better outcome?

 

LINDSAY:
It's hard to see how you move it to a better outcome, Shannon, given the fundamental fact that Putin is committed to this war and he's going to fight it until he wins. There's been a lot of talk about opening negotiations. The challenge we have there is the Russians are likely to view any offer to negotiate, hold a ceasefire, as evidence that their theory of the case is right, that the West or Ukraine is weakening, they're about to give up, and that brings to mind the old saying, "If I'm losing, how can I negotiate? If I'm winning, why should I negotiate?" And which is why I think a lot of the talk about the West pushing Ukraine to open up negotiations usually comes with the caveat that the people proposing negotiations don't expect Russia to respond positively, but they believe that making the effort changes the conversation, makes continued Western support more likely and sort of puts off this issue of Ukraine fatigue. And if Putin were to see chance for negotiations and take it, that in many ways is gravy. But I don't think negotiations are really on the table right now.

 

And from the Ukrainian point of view, their concern is even if we could get Russia to the negotiating table and Russia agreed to a ceasefire or truce, however you want to call it, that will just be a pause before the fighting resumes again, that Russia or particularly Putin is bent on conquering Ukraine and that makes it very difficult for the Ukrainians to think about any kind of agreement that may leave them regretting it down the road.

Shannon, we have a question from Elaine.

ELAINE:
Hello, this is Elaine. On the show, you've often talked about the Global South and its emergence and its quest for a new world order. My question would be what would a world order inspired by the Global South, its values and its priorities look like compared to the one we have today? Thank you.

 

O'NEIL:
Elaine, that is a great question because as you well know, there are lots of calls and announcements and pushes for and organizations trying to bring the Global South together and reform the international order or the global order in ways that are more inclusive for those countries. And so we see all kinds of middle powers as well as increasingly great powers like China trying to reshape various institutions either joining those institutions or forming their own, whether that's development banks and the like. We see organizations like the BRICS, which bring together lots of countries from the Global South.

 

But the one thing I think that characterizes all of these efforts from countries in the Global South that I've seen is that while they are against things, they're rarely for things. So they all agree that they want change in the system and they don't want it just to be the G7 or even the G20, perhaps. They want it to be much broader, but they don't really agree on what that other vision looks like. So I think in answering your question, what are their values or what are their priorities going to look like? It's very hard to say because this is really an odd bag in terms of countries. You have democracies and you have autocracies, you have countries that are nearing high income and very advanced manufacturing industrial status, and you have others that are still quite poor and unequal and even agricultural in some of their base. You have some that are fairly homogenous in terms of their populations and others that are very multicultural, multi-religious. And so there isn't a lot of agreement.

 

We saw little glimpses of this, I would say in the recent BRICS meeting when they expanded the BRICS and brought in new countries in that there was some reticence by some countries, and in fact, Indonesian in the end pulled out at the end and didn't want to join for various reasons and worries there that it wasn't going to be a new broad global order. Some countries I think felt it was going to be too dominated by China, which might be a Chinese order, but not a global order.

 

So I think as we look forward, what does the Global South bring? And that term itself is a little bit of an odd moniker because these countries don't have so much in common. I think we will see more differences. I think we will see more challenges to systems that are less inclusive, some of the things that we've seen in the past. You will see less attention to a G7 and you'll see more attention to these broader organizations, but I think it's going to be a bit messier.

 

Back in the nineties and the early 2000s, people used to talk about the Washington Consensus, and that's now vilified, but it was this set of ideas and principles based on market-based democracies and aspirations at least to open up your economies, to open up your financial systems, to allow markets and companies to guide your economic side of things and the politics to be guided by democracy. And I think a new Global South order, it's not going to be quite as defined there. It's going to be a lot of different trends. It won't be a global order the way we think about it in the past. It'll be a lot of competing interests out there in a global marketplace, whether it's economics or politics or society or the like.

 

LINDSAY:
Shannon, I have to ask you, since you mentioned BRICS, were you surprised that Argentina's new president has withdrawn Argentina from the BRICS just as it was about to enter?

 

O'NEIL:
I was not surprised actually, I think for a few reasons. One is Milei, the new president of Argentina has said, "A pox on all of your houses." He doesn't want to be part of any club. So that was part of it, right? He's reluctantly said he's not going to leave Mercosur, which is the trading agreement in South America and a few others, but he's not a joiner, let's put it that way so I wasn't surprised in that.

 

But I also wasn't surprised because there is a feeling among some countries, and Argentina and Milei especially is one, that the BRICS as it expanded was really about increasing rather than decreasing China's power within the BRICS and Milei has, at least until recently after being inaugurated and becoming a bit more pragmatic than he was on the campaign trail has been quite anti-China, anti-communist as he would say, and so he did not want to join a club that really was dominated by the Chinese Communist Party. So I'm not surprised that he pulled out.

 

What did surprise me a little bit was Brazil. Brazil went along but was somewhat reluctant in the expansion because they too felt that it was undercutting their influence among the original BRICS. They're very proud of being a founder of the original BRICS, but as more countries join-

 

LINDSAY:
They're the B in BRICS.

 

O'NEIL:
They're the B in BRICS, the first one, right, which they're very proud about, but when you add Saudi Arabia or Iran, you add these other countries, all of a sudden their role and their weight lessens.

 

All right, Jim, back to you. Here's a good question given that we were just talking about Saudi Arabia and joining the BRICS, and this comes from Michael via X and he has a real question about U.S.-Saudi relations and their future. So he says rightly that King Salman is about to turn eighty-eight years old, and once his reign ends, he wants to know what King MBS looks like, what that kind of administration's going to look like. Who might he choose as the crown prince? What might his cabinet look like and really what foreign policy would he be likely to pursue? Saudi Vision 2030, what does that look like? And are we going to see broader foreign policy coming out of a new Saudi Arabia, especially once the king moves on and MBS becomes the official ruler?

 

LINDSAY:
That's a big question Michael, and I don't know if I can answer it in the three minutes I have allotted. Let me make a couple of quick observations. One is that when MBS becomes king, and that is the expectation that he will succeed his father, I would expect him to continue on the path he has put Saudi Arabia. MBS has been the most powerful crown prince in recent memory, and his goal is essentially to modernize the country. He is invested a lot in new technology, new cities, new industries, and he's really trying to remake Saudi society and that is really where he's focused.

 

His great concern, of course, is that Saudi Arabia exists in a dangerous neighborhood. The Saudis worry a lot about Iran. Yes, China helped negotiate the reopening of formal diplomatic relations between Tehran and Riyadh, but don't take that to mean that all past issues have been buried and peace is reigning. The Saudis clearly worry about the Iranians going forward.

 

And MBS also has a desire to want Saudi Arabia to play a bigger role in the world. He sees like the leaders of countries around the world that we've moved into this more competitive geopolitical space. He has concerns about the extent to which he can rely on the United States. Saudis would prefer to rely on the United States. Again, most Saudis in the elite have spent a lot of time in the United States, gone to college in the United States, have much less exposure to China. But they also realize that the United States may be moving in a direction in which Saudi Arabia can't count the United States. They also have China as a very large consumer, purchaser of Saudi oil, whereas the United States is home to fracking. It's another competitor in the petroleum space. You also have the issue of climate change and the notion that we're going to have to cut our emissions, rely less on fossil fuels. That's another set of constraints on Saudi Arabia because obviously its ability to extract oil from under the ground more cheaply and in higher quantity than anyone else is what has catapulted Saudi Arabia up the list of countries in the world in terms of power and influence.

 

And so I think MBS's desire is to try to modernize this country and hopefully minimize its vulnerability to conflict. I think that's one of the reasons why you were seeing up until October 7th, a lot of talk about a rapprochement between Israel and Saudi Arabia, that the two would open up diplomatic relations. I think now with the war in Gaza, the horrific attack by Hamas on Israel that that diplomatic breakthrough is not going to be happening anytime soon.

 

O'NEIL:
Is there any constructive role Saudi Arabia can play in that particular conflict between Israel and Hamas or some of the larger conflagrations we've seen the Houthis, the militants and things? Is there a role that they could play that's constructive, or is that not where MBS wants to go?

 

LINDSAY:
Well, there are a lot of ways to answer that question, so let me just make a couple of observations. One is what has been interesting in the time since October 7th is the relatively moderated reaction in capitals like Riyadh, like Abu Dhabi. This is very different from the reaction in the Arab world fifty years ago in the wake of the October War, the Ramadan War, the Yom Kippur War, pick your title in which you saw the oil weapon being unsheathed for the first time. So in that sense, one could argue that the Saudis and Emiratis been very responsible. I think partly what one has to keep in mind when thinking about this is that the Saudis, the Emiratis, the Egyptians, a number of countries in the Middle East don't particularly like Hamas. It is an Islamic organization which gets aid from Iran, we just discussed. For Saudi Arabia, Iran is a significant geopolitical threat.

 

Their challenge is is getting leverage over Israel and getting Israelis to change their way and by all accounts, the Israelis are committed to the eradication of Hamas, a goal I don't think that they can achieve and I think is going to come at high cost for Israel's relations elsewhere in the world. We're already seeing the stress it's putting on the U.S.-Israeli relationship. And that leaves you with the question a lot of talk about, well, the Gulf country should invest in Gaza. Perhaps they could send peacekeeping troops to Gaza and I don't think there's big appetite for that in terms of investing. The concern is we'll build a new building, it'll get blown up three, five, seven years from now, and a real desire not to want to send troops for fear that they will themselves become embroiled in what is a very bloody conflict.

 

O'NEIL:
Just one more question on Saudi Arabia. How do you see the Saudi Arabia-Russia relationship? Because we have seen since the conflict in Ukraine, we've seen OPEC cut back and particularly Saudi Arabia cut back on production trying to boost prices, which has been deemed helpful to Russia. But traditionally the U.S. and Saudi Arabia had very close relationships, but all of a sudden the last two years has been somewhat distanced, particularly because of the Russia-Ukraine war. How do you see that evolving?

 

LINDSAY:
Well, there's sort of two dimensions there. I mean, the U.S.-Saudi relationship is strained for lots of reasons, and it's not going to be fixed anytime soon. Again, as I mentioned before, many Saudis, and I think the crown prince is among them would love to have a formal security arrangement with the United States. I just don't think any kind of formal military alliance with the United States is sellable in the United States, certainly not in the United States Senate. And again, this brings to mind the killing of Jamal Khashoggi, which I think has clearly just created an insurpassable barrier on that score.

 

In terms of Riyadh and Moscow, I would say that to the extent they have overlapping interests, they find ways to work together and when they decide their interests are at odds, they part their ways. If you chart the course of OPEC and its relationship to Russia, it has had ups and downs. There was a period of time in which they basically were in different corners, and the Saudis help drive prices weigh down as a way to punish the Russians. Right now, their interest seem more aligned, and this gets back to the issue that Saudi Arabia is a major producer, but you also have the appearance of the United States as the world's largest producer of oil because of the fracking revolution. So there are just competing interests here, and it's one of these things where countries, let's say, don't fall in love with others. They're just interested in who can help them advance their bottom line. I think this is sort of realpolitik at its finest.

 

Shannon, I want to ask you one last question. It's probably unfair because you don't have a lot of time to answer, and this is not a topic of your expertise, but I don't have any expertise in the topic either so I think it's fair to ask you, and this comes from Nishi, and the question is, "Scientific advances benefit from collaboration between researchers, but what happens when materials such as artificial intelligence, AI, is controversial and important to a nation's national security? Is there a middle ground between sharing information, denying access? How can we regulate cooperation?"

 

I guess this is really a question about sometimes it's about supply chains and how you monitor them, though I don't understand any of the technology involved so over to you.

 

O'NEIL:
This is the idea supply chain, right? And how you're connected there. This is something that the United States and other countries have struggled with, I would say for decades. You look back in the twentieth century and you had Russian and German scientists coming here during World War II and helping us build the atomic bomb, but then also being questioned where their loyalties lay at certain moments and the like. So it's not sort of a new question about people's nationalities and their allegiances and then new technologies that could be deadly. AI has a little bit of a different side, but we have seen in recent years a lot of moving back and forth on this.

 

So the United States, one of the strengths of the United States has been that it has attracted often the best and brightest from all over the world. U.S. universities are known for having immigrants come in, and many of these immigrants have big scientific breakthroughs. They stay in the United States, they are the holders of a very strong percentage of the patents that are in the United States because of the research and things they've done here. You look at PhD programs in the United States, a big percentage are people from all over the world.

 

But we have also seen increasing worries about national security and where those individuals come from. And there has been a particular focus and in some legislation on particularly Chinese scientists, because there have been moments where Chinese scientists have worked here and then gone back and taken technology back with them and the like. And then others just worries that that might happen more broadly, that there might be espionage and the like, whether in universities or in corporations or the like.

 

AI adds a little bit of a twist to this because not only is it vital for national security because those who control AI probably control lots of the future, but there's also this outside chance, or maybe depending on how you feel about AI inside chance that it's not just which country controls it. Maybe AI will control it, right? Maybe they will become smarter than all of us and-

 

LINDSAY:
The Terminator.

 

O'NEIL:
Yes, the Terminator, right? That side. And there are some in Silicon Valley and other places who lean into this a little bit more than others. And this is the big debate that was behind the kerfuffle at OpenAI recently where Sam Alton was in and then he was out, and then he was back in again. So some of this was the debate on the board about how existentially dangerous it is.

 

And so as we think about national security, I think what we do know is that sharing information and innovation happens much faster, better when it crosses borders, that bringing together the best minds and research and the sharing of ideas, you see the brilliance, it really depends on the back and forth. If you want to see an example of this, there's a great book called Codebreakers about the forming of CRISPR, and it shows people all over the world competing with each other from France, from China, from the United States and the like. And they all build on each other. They compete, but they build on each other. And they really came up with the technology that allowed us to create mRNA and COVID vaccines and all kinds of other things that may improve our health far into the future. So there's a huge benefit here, but there are real national security concerns and espionage concerns and the like.

 

And so that balance, I think through history, sometimes we've leaned more one way. Sometimes we've leaned more other way. But I do think what we have seen develop over many years are professional associations of academics. Some standards set within academic frameworks between universities, between groups, and then those professors, researchers, intellectuals working together within those confines. And I think there are efforts today, whether it is between universities, whether it's between people working in AI across lots of different countries, especially in Europe and the United States. They are trying to set those ground rules. And I think that's probably where we will find the coordination that Nishi you're looking for.

 

LINDSAY:
Well, I just hope that somebody can come up with a regulation that promotes all of the developments out of AI that produce good things and ban all the developments out of AI that produce bad things. But perhaps that is not something I'm likely to see.

 

O'NEIL:
We will see Jim. So one more question for you, Jim. Let me throw this one to you. And here's one from Quade that comes via voicemail.

 

QUADE:
Hi TPI. My name is Quade and I'm a junior at Duke University studying political science, economics and cultural anthropology. Over the past few years, I've repeated heard the proposition that there's significant potential for or already is an alliance or to use a more loaded term "axis of evil" between Iran, China and Russia. Sometimes other nations like North Korea and Venezuela are added as well. I tend to think this type of rhetoric needs to be very carefully thought out as it can lead to gross oversimplification and public misunderstanding of each individual nation's gripes with the U.S. and therefore a miscalculated American foreign policy.

 

My question is how do you think we should balance the very real fact that some of these countries collaborate together against the U.S. with the potential danger of mislabeling them as a unified block of malignant actors? Thank you.

 

LINDSAY:
Well, Quade has asked a question that goes to the heart of geopolitics. How does any country navigate a world in which some countries may be opposed to you, some countries may be a benefit to you and how to do it in a way that you don't build up a coalition against you? And this is an issue as old as time. And if you're interested in, there's lots of books on this question. I mean, I do think as you look out, there is something forming, I wouldn't call it alliance, I'll call it the axis of the aggrieved. There are countries like China, Russia, North Korea, Iran, most notably whose main beef is with the United States. They don't like what they see as unfair American dominance of the global economic and political system, and they would like to find some way to get away from that. They don't necessarily have a positive vision of what they want to do, which goes back to your points about the BRICs, Shannon. In that sense, there's sort of no glue about a positive vision, just a sense of dislike.

 

So what does that mean for whoever occupies the White House? What you do is you look for ways that you can divide that opposition so that it doesn't go here, and some events create better opportunities than others. Obviously with the war in Ukraine, what we've seen is a much closer cooperation among Russia, North Korea and Iran. Iranians and North Koreans see great benefit to providing help to Russia at its hour of need.

 

What's most interesting is that the Chinese, at least publicly have not done so. That doesn't mean there isn't leakage in the rest, but the Chinese have not, despite all the talk of a "strategic friendship with no limits" shown that there are very real limits to what it is that China will do for Russia. And so I think the challenge for the United States again, is not to try to turn every country into an enemy, but to look for ways that you can work with other countries. That's obviously going to be a big challenge with Russia given the war in Ukraine, and you can't compartmentalize that and find other things to work on with Russia. But eventually Putin will no longer be president of Russia. We'll have a new leadership and there'll be opportunities at that time to rethink things.

 

O'NEIL:
Do you see opportunities for the U.S. government, whether it's the president or the Congress or other parts to dissipate those connections that have been formed around Russia or to lessen their influence more broadly, I would say?

 

LINDSAY:
I think it's very difficult for the United States to do in any direct sense, whether in the White House or Capitol Hill. In world politics as in day-to-day life, relationships rise and fall depending upon the circumstances particular to the people involved in those relations. So I wouldn't want to suggest that the United States can operate some sort of global risk board and sort of move things around and build coalitions like that.

 

I think most of what you have to do is look for opportunities when politics makes it possible to build relations with countries and also moving outside the axis of aggrieved. And when you think of the Global South, the United States has one great advantage compared to the other major powers. It has lots of friends, lots of partners, lots of allies. Now, occasionally we run roughshod over their interests, which is not a good idea, but I think to some extent dealing with the axis of aggrieved really is about the United States cultivating its own group of friends, partners, and allies. And I think the United States could do a better job of that, certainly by starting out in its own neighborhood with the country that you know quite well, Mexico, but certainly other countries in Latin America and Africa.

 

And as you know Shannon, there's an awful lot of opportunity in Africa. It is the fastest growing population in the world and needs a lot of help. And one of the reasons why China has been able to build inroads in Africa is because the Chinese show up and give gifts. The Americans show up and give lectures, and it may be useful for the United States to begin thinking a bit more strategically about how it interacts with, for better or worse, what we call the Global South.

 

Okay, Shannon, I think that brings us to the close of our conversation. I think we have stretched our producer's patients as far as can be stretched. Thank you, Ester. I'm going to close up this year-end special question and answer episode of The President's Inbox. I have been joined by my good friend and colleague, Shannon O'Neil, who is the deputy director of Studies and the Nelson and David Rockefeller, senior fellow for Latin American Studies here at the Council. Shannon, as always, a pleasure to chat.

 

O'NEIL:
It's always a great conversation. Thanks for having me.

 

LINDSAY:
Please subscribe to The President's Inbox on Apple Podcast, YouTube, Spotify, or wherever you listen and leave us your review. We love the feedback. The publications mentioned in this episode in a transcript of our conversation are available on the podcast page for The President's Inbox on CFR.org. As always, opinions expressed on The President's Inbox are solely those of the host or our guests, not of CFR, which takes no institutional positions on matters of policy.

 

Today's episode was produced by Ester Fang and Michelle Kurilla with Director of Podcasting Gabrielle Sierra. This is Jim Lindsay. Thanks for listening.